Venezuela fines General Motors over spare parts' prices

CARACAS (Reuters) – Venezuela’s socialist government said on Tuesday it was fining the local subsidiary of General Motors nearly $85,000 for allegedly selling spare parts at exorbitant prices.

The measure came as part of an aggressive drive by President Nicolas Maduro’s government to tackle Venezuela’s high inflation rate by forcing businesses to lower prices.

Soldiers and state inspectors have been visiting hundreds of shops and companies, and have jailed dozens of people accused of price-gouging, in what Maduro calls an “economic war”.

Though government supporters applaud the moves, critics say the high inflation rate is a product of 15 years of statist economic policies begun by late president Hugo Chavez in 1999.

Local businessmen say the situation is exacerbated by decade-old currency controls that restrict importers’ access to hard currency at the official rate and force some to buy dollars on the black market, passing on the cost to consumers.

Speaking from the GM subsidiary’s assembly plant in central Carabobo state, Industry Minister Ricardo Menendez accused it of selling spare parts at up to 500 percent more than cost.

“Obviously this is a case of usury,” he said.

“We are applying the highest fine possible … This has to stop. These speculative practices against the Venezuelan people have reached an end with the revolutionary government that is determined to defend the middle and lower classes.”

The company will have to pay 535,000 bolivars, the minister said. That is $84,920 at the official exchange rate of 6.3 bolivars per dollar. Calls to GM in Venezuela went unanswered.

Like many products ranging from toilet paper to milk, car parts have become increasingly hard to find in Venezuela this year. Businessmen are predicting worse shortages for early 2014 due to a deterrent effect created by the recent crackdown.